Differentiation of human cytotrophoblasts to syncytiotrophoblast and the associated induction of aromatase/hCYP19 gene expression are dependent upon a critical O(2) tension; however, the underlying molecular mechanisms remain undefined. In this study, we provide compelling evidence that expression of the orphan nuclear receptor, estrogen-related receptor γ (ERRγ), is also O(2) dependent, induced during human syncytiotrophoblast differentiation, and plays an obligatory role in the induction of placenta-specific hCYP19I.1 gene expression. Treatment with the selective ERRγ agonist, DY131, or overexpression of ERRγ, stimulated hCYP19 expression in syncytiotrophoblast. Overexpression of ERRγ prevented effects of hypoxia to repress hCYP19 gene expression in cultured trophoblasts. Conversely, small interfering RNA-mediated knockdown of endogenous ERRγ in primary trophoblasts markedly inhibited hCYP19 expression. Promoter and site-directed mutagenesis studies in transfected placental cells identified a nuclear receptor element within placenta-specific hCYP19 promoter I.1 required for ERRγ-stimulated activity. Recruitment of endogenous ERRγ to the nuclear receptor element region in hCYP19 promoter during trophoblast differentiation, assessed by chromatin immunoprecipitation, was prevented by hypoxia. Deferoxamine-induced hypoxia-inducible factor-1α (HIF-1α) levels decreased ERRγ expression, whereas knockdown of endogenous HIF-1α prevented ERRγ suppression by hypoxia. Chromatin immunoprecipitation analysis of trophoblasts cultured in hypoxia revealed recruitment of HIF-1α to one of two putative hypoxia response elements in the ERRγ promoter, providing in vivo evidence of a direct HIF-1α involvement in ERRγ expression. Collectively, these novel findings identify ERRγ as an O(2)-dependent transcription factor and HIF-1α target gene that serves a critical role in the induction of hCYP19 expression during human trophoblast differentiation.